Everyone seems to think that a 'modchip' is the only way to successfully install a modified dashboard into your XBox Hard Drive. It isn't. There are numerous ways to do so, some easy, some hard, and some that don't cost any money at all, but most of those are the hard ones. There are tutorials on how to softmod your XBox (not too safe, but easy if you do it right) with a game, a memory card, and an XBox action replay. Xbox scene is a good place to start, check up on tutorials there.
I just wanted people to know what you can mod an XBox without a modchip, and without shelling out hundreds to buy one. And it is entirely possible to load PC KOTOR and KOTOR 2 mods onto your XBox HDD using a TDATA folder or a UDATA folder. Or, you can use a program called dvd2xbox (you can find it at the 'usual' places, if you know what i'm talking about) to copy the game to your modified XBox dashboard or Hard Drive.
I've done this successfully, and am having a good time playing with mods made for the PC version. Yes, it is hard to make your own mods for the XBox versions without having it on the PC, but it's possible. You just can't upload clothing models, lightsaber models you can, but sometimes it won't load and the saber blade will be nothing but a line of white, which isn't what you downloaded it for.
I have a thread on Xbox Scene that has a list of around 20+ mods compatible with the XBox version of KOTOR 1. If you have any other questions for XBox KOTOR 1 modding, please send me a personal message or to my AIM - collapsedshark15 . Hope this clears some things up.